Company sources said net profit in the quarter is expected to be around Rs 6-7 crore as compared to Rs 1.51 crore in the corresponding quarter of previous year. The sharp rise in net profit is attributed to improved off-take of the company's products, firming up of product prices and major orders from Oil & Natural Gas Commission.

The company had a net profit of Rs 1.80 crore in the first quarter ended June 1999. The company's unaudited results for the year ended March 1999 showed a net profit of Rs 8 crore which was revised to over Rs 10 crore in the audited financial results. The company has an equity base of Rs 25 crore.

Sources said the annualised earnings per share during the current fiscal on the basis of the first half net profit of around Rs 9 crore could thus rise to around Rs 8 and thus improve the company's stock valuation. The company's share has attracted the attention of the investors in the last few weeks in anticipation of strong improvement in the company's earnings during the current fiscal. The stock has attracted the attention of the institutional buyers in the past few sessions, market sources said.

The share price in the past few sessions has shot up from Rs 17 to the current level of Rs 25. The stock hit the circuit on the National Stock Exchange at Rs 25.5 on Thursday.

According to industry sources, the prices of seamless tubes have also gone up in the last three-four months which will further improve the bottomline of the company during the current fiscal. According to industry sources, the prices of seamless tubes have firmed up by around Rs 5 a kilogram from Rs 30 per kg to around Rs 35 a kg.

Further, a strong book position, especially from the PSU giant, Oil and Natural Gas Commission would add a few more crores to the company's bottomline in the coming months. Sources said the rise in product prices coupled with improved offtake could see the company end the current financial year with a net profit in the region of Rs 18-20 crore.

Another notable factor is that although the steel industry has been in doldrums, Mahrashtra Seamless has managed to stay afloat and maintained a healthy net profit for the past two financial years. The company's turnover improved from Rs 155 crore in 1997-98 to Rs 185 crore in 1998-99. The company managed to sustain its bottomline at Rs 8 crore. For the first quarter ended, the company reported a net profit of Rs 1.8 crore on a turnover of Rs 36 crore. There was a substantial improvement in the company's profitability margins.